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Growth of High-Tech Sector drives US Office Market

Posted on 31 August, 2014 by Jodee Redmond

CBRE has published a research report entitled, U.S. Tech-Twenty: Measuring Office Market Impact, which shows that high-tech employment growth has played a pivotal role in the recovery of the office market.

It has also helped to generate rent increases in the double-digit range in eight markets over the past two years, including Austin, Manhattan, San Francisco, and Silicon Valley.

The report tracked data on high-tech employment and office market conditions in 20 tech-oriented office markets in various locations across the United States.

Its results found that since 2009, the high-tech sector has been responsible for 25 per cent of every new “office-using job.”

The report continues to state that;

• High-tech accounted for 20 per cent of major leasing activity in 2014. This figure is up from 14 per cent in 2013.
• San Francisco tops the U.S. Tech-Twenty Office Markets list for the third year in a row. Over the past two years, the city’s high-tech job base has increased by 51 per cent and average asking rents have grown by 35 per cent.
• San Diego, Orange County, and Portland offer the greatest potential to investors. These markets are attractive to occupiers as well. Raleigh-Durham has the best combination of low office rents and a growing high-tech labour pool for employers to draw on.

Strong demand from consumers for products and services is feeding high-tech’s growth and this is expected to continue to drive demand for commercial property in these markets.

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